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Ralph Inc. issued $4,300,000 of 5% bonds payable on 1 September 2019 to yield 4%. Interest on the bonds is paid semi-annually and is payable
Ralph Inc. issued $4,300,000 of 5% bonds payable on 1 September 2019 to yield 4%. Interest on the bonds is paid semi-annually and is payable each 28 February and 31 August. The bonds were dated 1 March 2018, and had an original term of five years. The accounting period ends on 31 December. The effective-interest method is used. Required: 1. Determine the price at which the bonds were issued. (Round your final answer to the nearest whole dollar amount.) Price of Bond 2. Calculate the interest expense that would be recorded in each of 2019 and 2020. (Round your final answers to the nearest whole dollar amount.) 2019 2020 Interest expense 3. Show how the bond would be presented on the statement of financial position as of 31 December 2019 and 2020. (Round your final answers to the nearest whole dollar amount.) HAMBELTON LIMITED Statement of Financial Position (Partial) As of 31 December 2019 2020 Bonds payable Premium on bond payable wan S
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